Even Hollywood Can't Save China's Box Office This Year

The release of the year-end Chinese box office numbers has become an exercise in self-congratulation, as the Middle Kingdom has celebrated astronomical increases — like last year’s 49 percent — in its annual gross, putting it on an accelerating pace to catch the U.S. as the world’s largest movie market. This year, however, will be different – and the scores of Hollywood superheroes who graced China’s silver screens in 2016 couldn’t swoop in to save the day.

According to data from Ent Group, China’s box office is up just 4.5 percent through Dec. 15 compared with the same time last year – and actually down 10.5 percent from July on. After surging from $4.8 billion to $6.8 billion between 2014 and 2015, the Chinese box office may have to wait another year to break the $7 billion mark.

So what happened? Insiders point to handful of major causes, namely increased vigilance of “ghost screenings” — when a distributor buys out seats in bulk, only to re-sell them at a lower price on the secondary market, a disappointing slate of local films aside from “the Mermaid” – and possibly most importantly, a reduction in the exceedingly generous online ticketing subsidies doled out by huge conglomerates like Baidu, Alibaba and Tencent, who have been using those carrots to attract users to their payment platforms.

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Under the subsidies, Chinese movie fans could see new Hollywood films in IMAX 3D for as little as $5. Prices have now reverted closer to the actual cost, which makes a night at the movies not as good of a deal as it was before — and likely depressed demand, especially on the margins and in less wealthy cities.

And as the box office started to decline for the first time in years, newly desperate times apparently called for desperate measures: There are 38 imported films scheduled for release in China through Dec. 31, four more than the official quota. According to Chinese media reports, government censors said the additional films are part of “cultural exchange projects” and do not reflect a breaching of the quota, but semantics aside, there are still four additional non-Chinese films playing in Middle Kingdom multiplexes this year.

Several of those movies, including “Sully,” “Hacksaw Ridge” and “Miss Peregrine’s Home for Peculiar Children” even got December release dates, which is a time of year typically reserved for homegrown fare.

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China’s box office began the year with a bang, as Stephen Chow’s “The Mermaid” rolled to $528 million, making it easily the highest-grossing film of all time in China – knocking out “Furious 7.” However, no other homegrown Chinese film made more than the $185 million “The Monkey King 2 3D” brought in, which was a major letdown for Chinese cinema. Last year, five Chinese movies (“Monster Hunt,” “Mojin: The Lost Legend,” “Lost in Hong Kong,” “Goodbye Mr. Loser” and “Jian Bing Man”) cleared the $185 million mark.

Hollywood tentpoles couldn’t make up the gap — “Zootopia,” “Captain America: Civil War” and “Warcraft” were massive hits in China, but “Batman v Superman: Dawn of Justice” failed to clear the $100 million mark, “The Force Awakens” failed to make the impact it did in virtually every other market — and “Suicide Squad” didn’t even get a Chinese release.

China’s box office should find itself back on a growth trajectory after recovering from the shock of having customers pay closer to market price – and assuming local cinema can recover from a down year. The average Chinese moviegoer still sees just one film a year, according to data from Chinese online ticket seller WeYing. The corresponding number in the U.S. is 3.8, per data from the MPAA.

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And the country is adding theaters by the hundred, with Imax planning to get up to 1,000 screens in mainland China in the near future. There are currently slightly more than 1,000 Imax theaters in the world.

China continues to aggressively build a film industry. But now, for the first time, it’s a question of who will come.

Hollywood's 22 Biggest Box Office Champs in China (Photos)

Chinese moviegoers love to spend their hard-earned yuan on Hollywood blockbusters like "Captain America: Civil War," "Avatar" and "Star Wars: The Force Awakens." Comedies and dramas? Not so much. Read on to see which American hits have raked in the most money (according to BoxOfficeMojo) in that nation across the Pacific.
Disney/Marvel/Lucasfilm/Fox
"Furious 7" (2015)

$390.9 million

The Vin Diesel and Dwayne Johnson revved-up action flick is easily the highest-grossing Hollywood movie ever in China. The late Paul Walker remains among China's most beloved American actors.
Universal
"Transformers: Age of Extinction" (2014)

$320 million

Mark Wahlberg starred in the sci-fi movie based on the foldable toys, which was co-produced by two Chinese firms and was the first Hollywood movie to make more than $300 million in the Middle Kingdom.
Paramount
"Avengers: Age of Ultron" (2015)

$240.1 million

The superhero mashup is China's highest-grossing Marvel Cinematic Universe film, a franchise that's been embraced by the country's young-leaning moviegoers.
Marvel
"Zootopia" (2016)

$235.6 million

The buddy-cop comedy is the highest-grossing imported animated film in the history of the Chinese box office, and it played especially well in China's second- and third-tier cities.
Disney
"Jurassic World" (2015)

$228.7 million

Like "Furious 7," the dinosaur sci-fi adventure was produced by Legendary Entertainment, which was acquired by China's Dalian Wanda Group in January.
Universal
"Warcraft" (2016)

$220.8 million

Another Legendary film, this one inspired by a video game series, flopped in the U.S. but dominated the Chinese market, which is home to about half of the video game's players worldwide.
Universal
"Avatar" (2009)

$204.1 million

The worldwide smash hit also captivated Chinese audiences, even back in 2009, when the country's box office was a fraction of the size that it is today.
Fox
"Captain America: Civil War" (2016)

$190.4 million

The latest film in the Marvel Cinematic Universe -- with an ensemble cast that includes Robert Downey Jr., Chris Evans, Scarlett Johansson and Don Cheadle -- continued the iconic comic book company's momentum in China.
Marvel
"Transformers: Dark of the Moon" (2011)

$165.1 million

The prequel to this film, 2009's "Transformers: Revenge of the Fallen," made $65.8 million in China, setting the stage for "Dark of the Moon" to be the country's highest-grossing Hollywood film since "Avatar" at the time.
Paramount
"Kung Fu Panda 3" (2016)

$154.3 million

The Mandarin-language version of the movie starring Jack Black as a friendly fighting bear had the characters reanimated so their mouths moved naturally with the translated words.
DreamWorks
"The Jungle Book" (2016)

$150.1 million

The live-action/animation hybrid was a hit in several international markets, especially India, and it also played well throughout China.
Disney
"Mission: Impossible - Rogue Nation" (2015)

$135.7 million

China's Alibaba Pictures invested in "Rogue Nation," and star Tom Cruise visited several Chinese cities to promote the film, helping it open strong and stick around in theaters even though its China debut came more than a month after its U.S. premiere.
Paramount
"Star Wars: The Force Awakens" (2016)

$124.2 million

Despite China being one of the few markets that didn't catch "Star Wars" fever -- the movie put some people there to sleep -- Disney's promotional efforts helped it clear $100 million.
Lucasfilm
"Interstellar" (2014)

$122 million

The epic space adventure starring Matthew McConaughey, Anne Hathaway and Jessica Chastain connected with Chinese audiences, even though it wasn't in the 3D format that crowds there have grown used to.

Paramount
"The Hobbit: The Battle of the Five Armies" (2014)

$121.7 million

The third and final installment in Peter Jackson's "Hobbit" series was another movie that succeeded even though it was released in China well after its U.S. premiere.
Warner Bros.
"Iron Man 3" (2013)

$121.2 million

All three movies in the Robert Downey Jr. franchise have played in China, helping build brand awareness beyond just the bankable Marvel name.
Marvel
"X-Men: Apocalypse" (2016)

$12o.8 million

Disney bought Marvel Entertainment in 2009, but Fox acquired the film rights to Marvel's "X-Men" franchise before then. It doesn't seem to matter much in China, where anything Marvel often turns into a big hit.
Fox
"Captain America: The Winter Soldier" (2014)

$115.6 million

The predecessor to this year's "Civil War," "Winter Soldier" was a hit despite its fairly political content, which is usually a negative in Chinese theaters.
Marvel
"Terminator Genisys" (2015)

$113.2 million

The fifth "Terminator" film was the franchise's lowest-grossing since the 1984 original, but it was the first in the series to get a Chinese theatrical release.
Paramount
"Pacific Rim" (2013)

$111.9 million

The futuristic sci-fi adventure, in which humans battle sea monsters, is yet another fantasy action movie that Chinese audiences loved.
Warner Bros.
"Ant-Man" (2015)

$105.4 million

Yet another Marvel Cinematic Universe movie, "Ant-Man" made just $180.2 million at the domestic box office but was a much bigger hit in China.
Marvel
"San Andreas" (2015)

$103.2 million

China knows Dwayne Johnson from the "Fast and Furious" franchise, and the earthquake disaster film he headlined last year reverberated at the Chinese box office.
Warner Bros.

1 of 23

Chinese moviegoers can’t get enough of America’s big-budget action flicks

Chinese moviegoers love to spend their hard-earned yuan on Hollywood blockbusters like "Captain America: Civil War," "Avatar" and "Star Wars: The Force Awakens." Comedies and dramas? Not so much. Read on to see which American hits have raked in the most money (according to BoxOfficeMojo) in that nation across the Pacific.

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Hollywood's 22 Biggest Box Office Champs in China (Photos)

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